BSkyB

Two text message exchanges stand out from this morning’s Leveson testimony by Jeremy Hunt, both sent on the day we found out that Vince Cable had told undercover reporters he had “declared war on Murdoch”.

The first was one sent by the culture secretary to James Murdoch. Referring to the European Commission’s decision to let the News Corp’s bid for BSkyB proceed, Hunt texted Murdoch:

In the light of what we learned yesterday about Jeremy Hunt’s strong views that the News Corp bid for BSkyB should go ahead, it is interesting to read these guidelines from the Competition Commission on the standards to which their staff should be held.

The Competition Commission, was of course, one of the bodies that could have ended up examining the bid, just as Hunt was when he was asked to make a “quasi-judicial” judgement on whether it should go ahead.

The CC tells its staff (emphasis mine):

There may be instances where a CC member or staff member has or appears to have prejudged the outcome of an inquiry. Circumstances in which prejudgement might arise would include those in which an article had been written or speech made expressing strong views about a particular merger or market.

The highlight of this afternoon’s evidence by Adam Smith, the former adviser to Jeremy Hunt, was the publication of a memo sent by the culture secretary to the PM before he gained responsibility for the decision on whether to let it proceed.

Here is what Hunt wrote, with what we think of as the important bits in bold (h/t to the Guardian, which put this on its website):

James Murdoch is pretty furious at Vince’s referral to Ofcom. He doesn’t think he will get a fair hearing from Ofcom. I am privately concerned about this because News Corp are very litigious and we could end up in the wrong place in terms of media policy. Essentially what James Murdoch wants to do is to repeat what his father did with the move to Wapping and create the world’s first multiplatform media operator available from paper to web to TV to iPhone to iPad. Isn’t this what all media companies have to do ultimately? And if so we must be very careful that any attempt to block it is done on plurality grounds and not as a result of lobbying by competitors.

The UK has the chance to lead the way on this as we did in the 80s with the Wapping move but if we block it our media sector will suffer for years. In the end I am sure sensible controls can be put into any merger to ensure there is plurality but I think it would be totally wrong to cave into the Mark Thompson/Channel 4/Guardian line that this represents a substantial change of control given that we all know Sky is controlled by News Corp now anyway.

It will be a shame if bitter and partisan debate over whether Rupert Murdoch is “a fit person to exercise the stewardship of a major international company” obscures the more important conclusion of the UK parliament’s culture, media and sport committee on phone-hacking: that he and his son James were wilfully blind to what was going on.

Whether BSkyB, controlled by the Murdoch-owned News Corp, is a “fit and proper” owner of a broadcasting licence is a question for Ofcom, the regulator, which has now entered an “evidence-gathering” phase of its probe.

NB: We refer to Rupert Murdoch as Rupert throughout for speed and to avoid confusion with his son James. Jay is Robert Jay QC, who is questioning Rupert.

16.45 What were the most interesting things that Rupert said today? Here’s a selection of three key moments. Let us know your thoughts in the comments.

“The News of the World, quite honestly, was an aberration, and it’s my fault”. Rupert said this in the context of defending his other newspapers and their integrity, thus characterising the NOTW as a sort of rogue newspaper – just as he once relied on the “rogue reporter” argument. However, it’s also noticeable that he appeared to take responsibility – “it’s my fault”. He would later say he was “sorry he didn’t close [the NOTW] years before”.

“I think the senior executives were all informed, and I — were all misinformed and shielded from anything that was going on there, and I do blame one or two people for that, who perhaps I shouldn’t name, because for all I know they may be arrested yet, but there’s no question in my mind that maybe even the editor, but certainly beyond that someone took charge of a cover-up, which we were victim to…” This is where Rupert effectively accuses “one or two” people at the News of the World of organising a cover-up of the extent of phonehacking at the newspaper.

“It’s a common thing in life, way beyond journalism, for people to say, ‘I’ll scratch your back if you scratch my back’”. It was as if Rupert momentarily let the veil fall when he made this offhand comment, giving a sense into what his critics might say is ‘the real Rupert’. Robert Jay QC was quick to jump on the remark, saying: “You said it was a common thing in life… and that’s true, that’s human nature, but it’s interesting that you say that’s no part of the implied deal in your relations with politicians over 30 years, Mr Murdoch. Is that right?” Rupert saw the trap and took evasive action: “I don’t ask any politician to scratch my back… That’s a nice twist, but no, I’m not falling for it.”

Welcome to our live coverage of the Leveson Inquiry into the standards and ethics of the UK press, on the day when Rupert Murdoch, chairman and chief executive of News Corp, is giving evidence.

By Esther Bintliff and Salamander Davoudi in London, with contributions from FT correspondents. All times London time.

NB: We refer to Rupert Murdoch as Rupert throughout for speed and to avoid confusion with his son James. Jay is Robert Jay QC, who is questioning Rupert.

16.40 We’re going to close the blog for now, but as ever we’ll have more news and analysis for you on FT.com.

And we’ll leave you with the latest development: officials at the FSA are interested in the News Corp emails that were published yesterday, and in particular an email sent by Fred Michel, News Corp’s director of public affairs, in which he described obtaining “absolutely illegal” information from Adam Smith, an adviser to Jeremy Hunt. Read the full story here.

16.15 So, today’s session was shorter than expected, and Rupert’s evidence did not really yield any explosive revelations of the level that James did yesterday. But it’s important to remember that in his questioning of Rupert, Robert Jay QC was largely focused on the decades in the run-up to the two most controversial issues for News Corp (i.e. the phonehacking scandal and the bid for BSkyB) rather than addressing those issues directly – he will presumably concentrate on phonehacking and BSkyB tomorrow.

Thus Jay spent a lot of time asking Rupert about key moments for the business during the 1980s and 1990s; his relationship with different political leaders; and his varying levels of editorial influence over the newspapers.

One could imagine that Jay’s strategy here was to lay the ground – very thoroughly – to then better understand Rupert’s/News Corp’s approach to the more recent issues, and to show whether there was any historical precedent for the behaviour that the company engaged in as it tried to get regulatory approval for its bid for the remaining shares in BSkyB. Read more

During the ongoing Commons debate on phone hacking David Cameron refused three times – pressed by Labour MP Dennis Skinner – to say whether he had had conversations with News International executives about the BSkyB while prime minister. He said only that he had had “no inappropriate conversations” with the company.

Separately he insisted that any meetings with NI during the period were not relevant because he had “asked to be excluded from the decision”. Read more

This is what happened to BSkyB’s shares just after the government announced it would back Labour’s motion on Wednesday calling for Rupert Murdoch to abandon his bid for the shares in the company he does not already own:

Westminster is in tumult. In the last hour, allegations of phone hacking, corruption and other journalistic misdeeds at News International have developed significantly.

Here is the latest:

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Jim Pickard is the FT's chief political correspondent, having joined the lobby team in January 2008. He has been at the FT since 1999 as a regional correspondent, assistant UK news editor and property correspondent.

Kiran Stacey is an FT political correspondent, having joined the lobby in 2011. He started at the FT as a graduate trainee in 2008, working on desks including UK companies and US equity markets before taking over the FT's Energy Source blog.